Survey for British Business Bank on carbon emissions and UK SMEs

A new report published by the British Business Bank with research by Ipsos MORI shows that awareness of net zero among smaller businesses is becoming significant (at nearly 60%), with around half of smaller businesses saying decarbonisation or reducing environmental impacts is a near-term priority.

The author(s)

  • Catherine Crick Public Affairs
  • Rebecca Klahr Public Affairs
  • Michael Loi-Koe Public Affairs
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Ipsos MORI supported this research for the British Business Bank through surveys with 1,200 owners or managers at small and medium businesses across the UK. The research, one of the most in-depth so far in this under-explored part of the market, highlights the potential collective influence of UK smaller businesses and the considerable contribution they could make to wider net zero objectives.

The report reveals that:

  • Small and medium businesses account for around half (50%) of UK business-driven emissions, the same proportion as larger businesses; and almost a third (30%) of all current UK greenhouse gas emissions (including emissions from households, industry and government).
  • More than half (57%) of smaller businesses have heard a lot, or a fair amount, about the government’s commitment to reach ‘net zero’ emissions by 2050, and the implications of climate change for their businesses (56%), establishing a strong base for further transition.
  • However, only half (47%) of smaller businesses state reducing carbon emissions or environmental impacts is a high or very high priority over the next two years. This split in attitudes demonstrates the need to raise awareness, balance the knowledge gap and ultimately help facilitate change.
  • When asked about physical actions, the vast majority (94%) say they have taken at least one action to reduce their emissions, though they tended to be low-effort ones, such as installing a smart meter.
  • Overall, the most common motive for taking action, mentioned by just over half (51%) of businesses, was that it ‘made financial sense’, speaking to the need to align net zero and financial objectives for businesses in the transition.
  • Meanwhile, 35% of smaller businesses state cost as a barrier for reducing carbon emissions, particularly upfront capital costs (21%).

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Technical Note

The research was mainly based on a bespoke, nationally representative survey comprising 1,200 interviews conducted between 3 August and 3 September 2021, using computer-assisted telephone interviewing (CATI) and based on a sample purchased from a commercial business database. The interviews had an average length of 27 minutes per business. The survey fieldwork was carried out by Ipsos MORI on behalf of the British Business Bank.

The survey targeted small and medium-sized businesses, defined as businesses having 0 to 249 employees, based in the UK. Quotas were set by employment size, sector and region to secure a representative pool of responses.

The representativeness of the results was further ensured by weighting the data to reflect the 2020 SME business profile (in terms of size, sector and region) from the Business Population Estimates 2020, published by the Department for Business, Energy and Industrial Strategy.

Estimates of the share of UK greenhouse gas emissions accounted for by smaller businesses are based on British Business Bank analysis of emissions and business data from public sources including the Office for National Statistics and the Department for Business, Energy and Industrial Strategy.

Survey results are reported directly in the research, and, where relevant, used in combination with analytical frameworks developed by the British Business Bank with specialist input from external research partners.

The author(s)

  • Catherine Crick Public Affairs
  • Rebecca Klahr Public Affairs
  • Michael Loi-Koe Public Affairs

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